How to Save Money on Car Insurance in 2026

Full coverage now averages nearly $2,700 a year⁽¹⁾. That's not a misprint, and for millions of drivers, it's a number that's been creeping higher every renewal cycle.

Rates climbed 50% since February of 2020⁽²⁾, driven by higher repair costs, supply chain disruptions, and surging claims. The good news is that national averages fell about 6% in 2025, the first rate relief in years⁽³⁾. That cooling creates an opening many drivers haven't taken advantage of yet.

About 49% of insured drivers say they're stressed about what they're paying. But roughly 64% also believe they're getting a fair deal⁽⁴⁾. Both things can't be true and for most drivers, the discrepancy comes down to one thing: they haven't compared rates recently.

1. Shop around — the savings can be larger than you might expect

If you haven't gotten a fresh quote in the past year or two, there's a good chance you could save big. Drivers who compare quotes and switch carriers save a median $461 a year, and 92% of those who switch end up paying less than they did before⁽⁵⁾. That kind of outcome isn't the exception, it's the norm.

The reason the savings can be so large comes down to how differently insurance companies price the same risk. Rates can differ by more than $1,000 a year between companies for the exact same driver and the same car⁽⁶⁾. In expensive markets like Florida, New York, and Michigan, switching savings often reach $700 to $900 a year. Where you live matters enormously, and so does which company happens to be competing hardest for your business at the moment you shop.

That range is consistent with what independent data shows across millions of shoppers. The savings difference exists not because some carriers are ripping people off, but because pricing models differ substantially and no single company is cheapest for every profile.

The broader shopping trend points the same direction. A record 47.3% of all auto policies were shopped at least once in Q1 2026, the highest rate LexisNexis has tracked since it began measuring this data⁽⁷⁾. Yet about 1 in 3 drivers have never switched carriers at all and pay roughly 7% more on average than those who have⁽⁴⁾. In this case, loyalty to any carrier costs you⁽⁶⁾.

How many quotes do you need?

Three to five quotes is the standard benchmark, and most online tools can return results in under five minutes. Start shopping three to four weeks before your renewal date. Many insurers offer 5% to 10% early-quote discounts to drivers who lock in coverage before their current policy expires. You get more leverage, and you don't have to rush the decision.

2. Bundle home and auto on one policy

If you have both a homeowner's policy and an auto policy, combining them with the same carrier is one of the most straightforward savings moves available. Average bundle savings run $542 to $869 a year⁽⁸⁾, which works out to roughly 10% to 25% off your combined premiums.

The savings vary by carrier. State Farm and Nationwide average 18% off bundled policies, Allstate averages 17%, Progressive 11%, and Geico about 6%⁽⁸⁾.

It's worth noting that a bigger discount percentage doesn't always produce the lowest total price. A company offering 18% off its own rate might still cost more than a competitor offering 11% off a lower base rate. Always compare the bundled total against standalone quotes from two or three other companies before committing.

What to do?

Call your current carrier and ask for a bundle quote. Then compare that number against fresh standalone quotes elsewhere. The carrier you land on might be different from the one you expected.

3. Raise your deductible

Raising your deductible from $500 to $1,000 typically reduces collision and comprehensive premiums by 10% to 25%, which is $100 to $300 a year for most drivers⁽⁹⁾. The principle is simple: the more financial risk you agree to absorb, the less the insurer charges you to carry the policy.

Mark Friedlander, Senior Director of Media Relations at the Insurance Information Institute, makes the case: "Increasing your deductible levels from $500 to $2,000 could reduce your premiums for the optional collision and comprehensive portions of a full-coverage policy by 50% or more⁽¹⁰⁾."

For drivers carrying physical damage coverage on a car that's worth less than it used to be, that math deserves a close look.

The break-even calculation is worth running. Raise your deductible by $500 and save $200 a year, and you've recovered the difference in 2.5 years, assuming you don't file a claim during that period. The longer you go without a claim, the better the math looks.

The rule worth following is to only raise your deductible to a number you'd actually be comfortable paying out of pocket. If $1,000 in car repairs would create real financial strain, keep the deductible where it is. This is a move for drivers who have enough liquid savings to absorb a larger hit if something goes wrong.

4. Try a telematics program — but understand the fine print

Insurance companies now offer apps or small plug-in devices that monitor how you actually drive. Safe drivers can earn real discounts, with maximum discounts advertised as high as 30% to 40%⁽¹¹⁾.

The major programs currently available:

• Nationwide SmartRide (up to 40%)
• Progressive Snapshot (up to 30%)
• State Farm Drive Safe & Save (up to 30%)
• USAA SafePilot (up to 30%)
• Liberty Mutual RightTrack (up to 30%)

But there is a caveat to consider:

Jasmine Afilalo, an insurance industry expert, notes that "companies advertise discounts as high as 25 to 40 percent, but anecdotally at least, we rarely see customers earn more than 15 to 20 percent off at renewal⁽¹³⁾."

In a Consumer Reports survey, the median annual savings from using telematics among all telematics users was $120⁽¹²⁾.

That gap between advertised and actual is worth factoring into your expectations. And about 1 in 4 telematics users see a rate increase, typically from hard braking, speeding, or phone use detected by the app. In short, this type of program can work against you if your driving habits don't hold up under measurement.

It's best suited for consistent, low-mileage drivers who don't brake hard and rarely drive late at night. If that describes you, the enrollment discount alone may be worth it.

5. Claim the low-mileage discount if you've cut back on driving

Most carriers set 7,500 miles a year as the top discount tier for low-mileage drivers. Under 5,000 miles, you're typically looking at rates 15% to 20% lower than standard⁽¹⁴⁾.

If you've retired in the past few years or now work from home, there's a good chance your mileage has dropped significantly. But your insurer still has your old estimate on file from when you enrolled. A simple call to update your annual mileage figure could trigger a 10% to 15% reduction with no other changes to your coverage. It takes about five minutes and costs nothing.

It's the kind of adjustment that slips through the cracks easily, especially if you've been with the same carrier for years. Check what annual mileage is listed on your current declarations page. If the number is materially higher than what you're actually driving, call and update it.

6. Pay your premium in full instead of monthly

Monthly installment fees add $2 to $5 per payment, which comes to $24 to $60 a year in fees alone. On top of that, 54% of drivers who pay full-coverage premiums monthly are paying about 4% more annually than those who pay in full⁽¹⁵⁾. On a $2,697 policy, a 4% savings is roughly $108 a year. On policies with a 12% pay-in-full discount, that's closer to $324.

If cashflow is the main concern, consider setting aside the monthly equivalent in a savings account throughout the year and paying the lump sum at renewal. You capture the discount and keep the money earning interest in the meantime, which more than covers the mild inconvenience of a larger payment once a year.

7. Improve your credit score (it affects your rate more than you know)

Insurers in most states use a credit-based insurance score, distinct from your standard FICO score, to estimate the likelihood of you filing a claim. The rate impact is substantial.

Bankrate data shows drivers with poor credit pay an average of $4,644 a year for full coverage, while drivers with good credit pay $2,638, a difference of $2,006 a year⁽¹⁶⁾. That's 76% more for the same coverage and the same car. The credit-to-insurance connection feels counterintuitive to a lot of people, but decades of actuarial data have consistently shown that credit patterns predict claim frequency.

Improving your credit over time, by paying down balances, clearing late payments, and reducing credit utilization, can produce premium reductions at your next renewal or when you re-shop. It's not a switch you flip overnight, but it is a lever that pays off in multiple areas of your financial life at once.

One important note is that soft credit inquiries used for insurance quotes do not affect your credit score. If you live in California, Hawaii, Massachusetts, credit-based insurance scoring is banned so if you're in one of those states, this particular variable isn't in play for you. In Michigan it’s still legal for insurers to use your credit history when calculating rates, but insurance law puts certain restrictions on the use of credit information such as requiring insurers to provide a disclosure statement when using insurance scores.⁽¹⁶⁾.

8. Add a second car to your policy

If you and your spouse or partner each insure your vehicles separately with different carriers, you're probably paying more than you need to. Multi-car discounts typically range from 8% to 35% depending on the carrier, with potential savings up to $830 a year. Nationwide, for example, averages a 34% multi-car discount, about $740 a year in savings⁽¹⁷⁾.

Consolidating onto one policy takes one call and usually produces immediate savings. Check whether the combined policy also qualifies for a bundle discount if you're adding a homeowner's policy at the same time. Stacking multi-car and bundle discounts on the same policy can produce some of the largest combined reductions available without changing your coverage at all.

9. Take a mature driver course — the ROI is hard to beat

Most carriers offer a 5% to 15% discount to drivers who complete a state-approved defensive driving or mature driver safety course. The AARP Driver Safety Course qualifies at most major carriers and can qualify you for up to 5% off for three years after completion⁽¹⁸⁾. The pattern is consistent across most states, even where it's not legally mandated.

It's a great investment, because a simple $30 course earns $120 to $300 a year in discounts. That's a return you'd be hard-pressed to find elsewhere. The discount typically needs to be renewed every three years, which means another $30 course for another three-year discount cycle.

10. Drop collision and comprehensive on a car that isn't worth much

If your vehicle is older, dropping collision and comprehensive coverage can cut your annual premium substantially, typically $800 to $1,200 a year⁽²⁰⁾. These are the coverages that pay to repair or replace your car after an accident or non-collision event like theft or weather damage. They also add up fast on vehicles whose actual cash value no longer justifies the cost.

Consumer Reports Chuck Bell offers a clear benchmark: "As a general rule, if your premium is more than 10% of the car's worth, it's time to consider dropping collision, and maybe comprehensive, too⁽¹⁹⁾."

Applied to a 2015 Ford Focus worth about $4,000 with $500 a year in physical damage coverage. That's 12.5% of the car's value. By Barry's standard, it's a candidate to drop.

Look up your car's actual cash value on Kelley Blue Book or Edmunds, then compare it to what you're paying for those coverages. If the math doesn't hold up, you're essentially buying insurance that would barely cover the payout in a total-loss scenario, after the deductible comes out. You can learn more about how much car insurance you actually need here.

Key takeaways

• Shopping around is the single highest-value action, with a median savings of $461 a year for drivers who switch and 92% paying less after switching.
• Bundling home and auto can add $542 to $869 a year in savings, but always compare the bundled price against standalone alternatives before committing.
• Raising your deductible by $500 typically saves $100 to $300 a year. It's worth doing if you have the liquid savings to cover a larger out-of-pocket cost.
• Low-mileage drivers, retirees, and remote workers should call their insurer and ask for a re-rate. Many save 10% to 15% just by updating their annual mileage on file.
• Your credit score has a large and often underestimated impact on your rate. The gap between poor and good credit averages $2,048 a year for the same coverage.
• A mature driver course costs $30 and earns three years of discounts. It's one of the best-return moves available to drivers 45 and older.

Compare current car insurance rates

The easiest starting point is comparing a few quotes right now. Most drivers can get personalized rates from multiple carriers in their zip code in under five minutes, and the comparison itself costs nothing.

Disclaimer

Insurance rates and availability vary by state and individual profile. Information presented here does not guarantee savings or approval for any specific rate or policy. Greensprout's editorial team writes on behalf of the reader. Our goal is to provide clear, useful information to help you make better financial decisions. Our editorial content is not influenced by advertiser relationships. Greensprout is an independent, advertising-supported publisher and comparison resource. We may earn compensation when you click on links to products from our partners. This does not affect our editorial standards or recommendations.

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